Our whole economic structure is dependent on having some form of value that we can not only use in day transactions and valuations, but as a method of both pricing assets and having faith that at some future time those assets will be valued at the same price. If the banking system does not trust the future value of the asset, it will not lend money on it or loan money to you to be repaid at a determined value. The international agreement that has been used to value the dollar is the Breton Woods Agreement. This was based on the US dollar and our gold backing the dollar. Nixon removed the gold backing as some countries held surplus dollars that if called would of given all of our gold to them. While the system continued to use the dollar as the reserve currency, it was based on a trust of the US system. Recent actions, the claiming of the Russian reserves in the World Banking system, and of other such actions has lead to the fear that any political desires of the US will determine the safety of the reserves and a fear on the debasement of the dollar could remove the status of reserve base. The present unrest in the middle east as well as the roughly 10 trillion in debt that we will have to roll over in 2026 is creating some tensions in the global banking systems. These same tensions are defining how you prep, and what do you use as a basis for trade after a TSHTF event. Creation of the Bretton Woods System The Bretton Whoops<!-- --> | ZeroHedge All of our plans for a soft solution depend on being able to limit our borrowing costs and use a combination of growth and inflation to reduce our debt as we did after WW2. For that to work we can not have a serious recession that both increases costs and reduces revenue. There are some indications that we are in fact in a bubble economy and that its continued expansion requires the success of AI, Some people argue that is instead the biggest bubble and about to explode. The Trillion-Dollar Oops To change the quote For a prepper, the economy is the water we swim in. If the dollar does collapse, how do we buy goods and even if we may survive with our resources, how do we survive in a world where everyone, including the government wants those resources. One of my granddads did not trust banks, he held gold right up to the time the government took it and gave him paper dollars. The penalities for not doing so were up to $10.000, 200,000 in today's money, fine and up to 10 years in jail. In addition after a certain date, it was illegal to use it. I have some silver as a hedge. Recently there was a spike in the market to about $115 an ounce. I for the fun of it asked locally about selling it. None of the local dealers would even pay $100 an ounce and its rapid drop to about $65 an ounce indicates that was a wise decision. While it is about $82 an ounce today, no ones knows its long term value.
Just remember that to replace the dollar as the reserve currency .. one has to exist. I don't see it being the Yuan, Yen nor the Euro. It's not going to be gold as everyone is going to want their gold to be delivered and not wind up being a book entry on a ledger at some depository. Yep, it's going to be the dollar for decades. And it's going to continue losing value. It will still be better than a digital dollar that they'll ram down our throats. Give me the 1, 5, 10 and twenty dollar bills I can fold and put in my wallet.
